Reviewing Regional Management (NYSE:RM) & Jernigan Capital (NASDAQ:JCAP)

Jernigan Capital (NASDAQ:JCAP) and Regional Management (NYSE:RM) are both small-cap finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their risk, analyst recommendations, dividends, institutional ownership, valuation, earnings and profitability.

Insider & Institutional Ownership

98.9% of Regional Management shares are held by institutional investors. 8.3% of Jernigan Capital shares are held by company insiders. Comparatively, 10.9% of Regional Management shares are held by company insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company is poised for long-term growth.

Dividends

Jernigan Capital pays an annual dividend of $0.96 per share and has a dividend yield of 4.8%. Regional Management pays an annual dividend of $1.20 per share and has a dividend yield of 3.4%. Jernigan Capital pays out 39.2% of its earnings in the form of a dividend. Regional Management pays out 24.3% of its earnings in the form of a dividend. Both companies have healthy payout ratios and should be able to cover their dividend payments with earnings for the next several years.

Profitability

This table compares Jernigan Capital and Regional Management’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Jernigan Capital	23.50%	35.87%	8.16%
Regional Management	6.96%	12.61%	2.23%

Analyst Ratings

This is a summary of current ratings and price targets for Jernigan Capital and Regional Management, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Jernigan Capital	0	2	4	1	2.86
Regional Management	0	2	3	0	2.60

Jernigan Capital presently has a consensus target price of $27.50, suggesting a potential upside of 37.91%. Regional Management has a consensus target price of $41.50, suggesting a potential upside of 17.86%. Given Jernigan Capital’s stronger consensus rating and higher probable upside, research analysts plainly believe Jernigan Capital is more favorable than Regional Management.

Risk and Volatility

Jernigan Capital has a beta of -0.05, suggesting that its share price is 105% less volatile than the S&P 500. Comparatively, Regional Management has a beta of 1.08, suggesting that its share price is 8% more volatile than the S&P 500.

Earnings and Valuation

This table compares Jernigan Capital and Regional Management”s top-line revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Jernigan Capital	$659.62 million	1.74	$187.96 million	$2.45	8.14
Regional Management	$645.60 million	0.49	$44.41 million	$4.94	7.13

Jernigan Capital has higher revenue and earnings than Regional Management. Regional Management is trading at a lower price-to-earnings ratio than Jernigan Capital, indicating that it is currently the more affordable of the two stocks.

Summary

Jernigan Capital beats Regional Management on 12 of the 17 factors compared between the two stocks.

About Jernigan Capital

Jernigan Capital, Inc. was a real estate investment trust focused on the U.S. self-storage industry. The company provided financing and investment capital for the development of self-storage properties, partnering with developers and operators on projects across the country. Founded by self-storage industry executive Dean Jernigan, the company made debt and equity investments in development-stage facilities and, in some cases, retained ownership interests as projects were completed. Jernigan served as the company’s chairman and chief executive officer.

About Regional Management

Regional Management Corp. is a consumer finance company that provides installment loans through its Regional Finance branch network. Its offerings include small-, medium- and large-sized loans, with terms and loan structures tailored to customers’ needs. The company serves consumers who may have limited access to credit from traditional lenders, including borrowers with non-prime credit profiles. It also offers optional insurance and other related products in connection with its lending services.